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Health Equity Takes Center Stage as CMS Focuses on Improving ACO Models

BLOG | March 29, 2024

VR Brand Awareness-LI-2024-13Health disparities play a significant role in many of the high costs and poor-quality health for millions of people in the United States. These disparities stem from multiple causes, and don’t have one simple solution. But as the financial and physical toll of health inequity continues to grow, the Centers for Medicare and Medicaid Services (CMS) is bringing it to the forefront in value-based care models.

In 2023, CMS revamped its Global and Professional Direct Contracting model to become ACO REACH (Accountable Care Organizations Realizing Equity, Access, and Community Health). CMS also recently announced new features to continue improving access and healthcare services for historically marginalized and disadvantaged populations. The Health Equity Benchmark Adjustment (HEBA) launched in January 2024. It’s one of the first and most forceful efforts to adjust financial targets for ACOs based on the characteristics of the population they serve. Organizations that selectively omit underserved populations, or avoid treating people with significant health disparities and risks, will now see an equity adjustment to their financial targets.


Average life expectancy in the U.S. today is about 76 years, down from its peak in 2014 of 78.9 years. But national averages mask dramatic differences when you dig a little deeper. A study published in JAMA Internal Medicine found that average life expectancy for an American could differ by as much as 20 years depending on the county where you live, from a high of 86.83 years in a Colorado county to a low of 66.81 years in a North Dakota county. While that data came from before the COVID-19 pandemic (which reduced average U.S. life expectancy across the board for the first time in 100 years), it still showcases the alarming and stark disparities that exist in one of the wealthiest countries in the world.

The Centers for Disease Control and Prevention calculates life expectancy by state, and the difference between the highest (Hawaii – 80.7 years) and the lowest (Mississippi – 71.9 years) is almost an entire decade. That gap jumps to almost two decades when you look at life expectancy by race or ethnicity, ranging from 83.5 years for Asian Americans to just 65.2 years for Native Americans and Alaska Natives in 2021.


Terms like “health disparities” are broad, but generally refer to something we could address by understanding the underlying causes and aligning our health services to the needs of underserved and marginalized populations. Healthy People 2030 defines it as “a particular type of health difference that is linked with social, economic, and/or environmental disadvantage.” The CDC includes “preventable differences in the burden, disease, injury, violence, or in opportunities achieve optimal health” in its definition.

Health disparities also contribute significantly to the cost burdens of U.S. healthcare. A study published by the National Institutes of Health found that the economic burden of racial and ethnic health disparities costs the U.S. economy more than $450 billion a year, up 41% from previous estimates in 2014. Education-related disparities for people with less than a college degree amounted to an estimated $978 billion a year in a 2018 analysis.

Given the financial and physical toll of these disparities – and the fact that many of these items are preventable or could be addressed with proper policy – it’s understandable why CMS is so focused on finding ways to improve health equity.


Healthcare delivery organizations participating in ACO REACH and other ACO or risk-based models need accurate, in-depth data to identify historically underserved or high-risk members of their patient population. But one big challenge remains for many organizations – the information comes from multiple different data sources.

Cleansing and normalizing the data so it’s available in a usable format across an entire technology ecosystem is difficult (or impossible) with most legacy data management systems. Many providers and payers participating in CMS programs must commit extensive human resources to manually compile and clean up incoming data before they can use it with analytics and care management tools.

The next challenge is translating insights into action. In a technology ecosystem of disconnected or disjointed point solutions, it’s time-consuming and difficult to take the information that comes from analytics tools and translate it into meaningful next steps for a care team. Providers may ultimately miss opportunities to improve access to affordable, high-quality care for the patients who need it most.

Cedar Gate’s fully integrated, composable platform is designed for a risk-based future. The entire platform is connected to a proprietary data management tool that ingests, normalizes, and cleanses data from any external source. The resulting information is stitched to each member, providing the most in-depth predictive and prescriptive analytics to find and address health disparities.

Those insights flow seamlessly into care management, utilization management, and clinical decision support applications to provide real-time data for care teams and providers at the point of care. It’s the only high-performance healthcare platform designed specifically for a value-based care future where organizations taking on risk and accountable for outcomes must be able to identify and address health equity.


Technology that helps organizations uncover and tackle health equity can dramatically improve outcomes for millions of patients. That leads to lower-cost care by focusing on challenges that contribute to poor health and limited access to care. At Cedar Gate, we built the only end-to-end suite of solutions specifically for value-based care. Healthcare organizations must be ready to march forward toward a VBC future or risk being left behind. Are you ready? Come join us in the Value Revolution.

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